Question

Evander is considering taking a $6,000

student loan that charges 3. 5% interest

compounded annually. Which amount is

closest to the total loan plus accumulated

interest in 4 years when he graduates?

F $6,885. 14 H $6,210. 00

G $6,840. 00 J $7,019. 15


Right answers only!

Answer 1

`~~~~~~ \textit{Compound Interest Earned Amount} \\\\ A=P\left(1+(r)/(n)\right)^(nt) \quad \begin{cases} A=\textit{accumulated amount}\\ P=\textit{original amount deposited}\dotfill &\$6000\\ r=rate\to 3.5\%\to (3.5)/(100)\dotfill &0.035\\ n= \begin{array}{llll} \textit{times it compounds per year}\\ \textit{annually, thus once} \end{array}\dotfill &1\\ t=years\dotfill &4 \end{cases} \\\\\\ A=6000\left(1+(0.035)/(1)\right)^(1\cdot 4)\implies A=6000(1.035)^4\implies A\approx 6885`